Ten more facts from Home Depot’s Q1
Home Depot this week reported first quarter net earnings of $2.4 billion. But there was a lot more to the company’s performance than meets the bottom line.
As reported earlier, the company’s first quarter was limited by a late-arriving spring selling season. Even so, sales were up 4.4% to $24.95 billion.
Here are ten additional facts from the Atlanta-based retail giant’s earnings call worth noting:
• Comp transactions decreased 1.5%. However, if garden business is excluded, the chain saw positive comp transaction growth.
• Comp average ticket increased 5.8%.
• Appliances, electrical, and lumber had double-digit comps in the quarter, said Ted Decker, executive VP of merchandising. Garden departments products negative comps, owing to the late jump on spring. And lighting was also negative, the result of LED price deflation. All other departments were at or above the company average.
• Big tickets were up 10.0%. The Home Depot defines “big ticket” as transactions above $900. Decker pointed to strong sales of vinyl plank flooring, appliances and various LBM categories for the double-digit gain.
• In remarks to analysts, Decker highlighted two merchandising moves. The first was a partnership with Syngenta and Fernlea to offer new Rio Dipladenia plants to stores as an exclusive. He described the plants as “low-maintenance, drought tolerant, and have reoccurring blooms throughout the growing season.” The second move was the launch of Olympic exterior stains, through an extended partnership with PPG.
• Comp store sales increased 4.4%. Comps increased 3.9% in the United States.
• Month by month in the U.S., the chain record comps of 5.1% in February, 5.5% in March, and 2.0% in April. “As you may have personally experienced, April was one of the coldest and snowy-est months in more than twenty years,” said CFO Carol Tome.
• Regionally, the company’s performance varied considerably. The Northern region, the company’s largest, posted flat comps “due to weakness in our seasonal categories,” said CEO Craig Menear. The company’s southern and western divisions fared better, with comps above the company average.
• Elsewhere in North America, Canada posted a slightly negative comp (in local currency); and Mexico was positive.
• As the result of a new accounting policy (ASU number 2014-09), Home Depot will record private label credit card and gift card programs differently. The change caused a $131 million increase to gross profit, and a corresponding $131 million increase in operating expenses. Under the new policy, the company counted a $33 million net increase in sales, and a $98 million decrease in cost of goods sold.
As reported earlier, the company’s first quarter was limited by a late-arriving spring selling season. Even so, sales were up 4.4% to $24.95 billion.
Here are ten additional facts from the Atlanta-based retail giant’s earnings call worth noting:
• Comp transactions decreased 1.5%. However, if garden business is excluded, the chain saw positive comp transaction growth.
• Comp average ticket increased 5.8%.
• Appliances, electrical, and lumber had double-digit comps in the quarter, said Ted Decker, executive VP of merchandising. Garden departments products negative comps, owing to the late jump on spring. And lighting was also negative, the result of LED price deflation. All other departments were at or above the company average.
• Big tickets were up 10.0%. The Home Depot defines “big ticket” as transactions above $900. Decker pointed to strong sales of vinyl plank flooring, appliances and various LBM categories for the double-digit gain.
• In remarks to analysts, Decker highlighted two merchandising moves. The first was a partnership with Syngenta and Fernlea to offer new Rio Dipladenia plants to stores as an exclusive. He described the plants as “low-maintenance, drought tolerant, and have reoccurring blooms throughout the growing season.” The second move was the launch of Olympic exterior stains, through an extended partnership with PPG.
• Comp store sales increased 4.4%. Comps increased 3.9% in the United States.
• Month by month in the U.S., the chain record comps of 5.1% in February, 5.5% in March, and 2.0% in April. “As you may have personally experienced, April was one of the coldest and snowy-est months in more than twenty years,” said CFO Carol Tome.
• Regionally, the company’s performance varied considerably. The Northern region, the company’s largest, posted flat comps “due to weakness in our seasonal categories,” said CEO Craig Menear. The company’s southern and western divisions fared better, with comps above the company average.
• Elsewhere in North America, Canada posted a slightly negative comp (in local currency); and Mexico was positive.
• As the result of a new accounting policy (ASU number 2014-09), Home Depot will record private label credit card and gift card programs differently. The change caused a $131 million increase to gross profit, and a corresponding $131 million increase in operating expenses. Under the new policy, the company counted a $33 million net increase in sales, and a $98 million decrease in cost of goods sold.